Denison Mines: Surges for No Apparent Reason

Denison Mines (Amex:DNN) more than doubled last week, with explosive volume on Friday. I expect we will see this kind of a pattern in many microcaps this January, as deeply-oversold conditions fuel upside volatility.

Was there any news behind last week’s move in Denison Mines? Yahoo! Finance doesn’t show any press releases, and though there was a filing Friday with the SEC on Form 6-K, it merely attached a December 23 press release announcing a successful financing. According to one of my readers, the stock was mentioned in James Dines’ newsletter, but I find it hard to believe that Dines has that much pull.

At the end of the day, it doesn’t matter why Denison Mines or other microcaps are moving up. The fact is that they are. There will be days of retracement, but this is a simple trend-driven market. Don’t overthink it. If Denison falls below the 50-day moving average — the blue line in the chart above — then the trend is over. Until then, nobody can say how much higher Denison, or any other beaten down microcap, will go.

DISCLOSURE: No position.

Comments

[Greg Pinelli:]

DNN is moving up in large part because it was irrationally trashed to begin with..It has excellent resource base and without a doubt will play a large part in any energy independent future the US has....Well run and easily going up to $4-5 by Spring......
Manages URPTF.one of the VERY few pure uranium storage plays....a BUY under $8.00...

Jan 04 09:47 PM

[NOWHEREMAN:]

DNN under $2, sures sounds like speculative stock. No earnings.

NXG, speculative also, at .90 has a pe of 9.0.

Jan 05 12:49 AM

[WhatsTheSto...:]

If you call up these small juniors they will tell you that end of year tax selling was a key that put a damper on the stocks.

Now with the new year they all popped. Ultimately that is the reason I believe. And Mr. Dines rec didn't hurt.

Jan 05 11:59 AM